Case Study: General Motors 2018-02-01T15:28:40+00:00


BackgroundGeneral Motors is The world’s largest industrial corporation and full-line vehicle manufacturer
They are ranked in the top 30 in the Fortune 500 list of the largest United States corporations by total revenue for their respective fiscal years.
With a global presence in over 190 countries, at the time, General Motors employed approximately 647,000 people, and partnered with over 30,000 supplier companies worldwide.

IssuesGeneral Motors realised that the role of their suppliers were becoming increasingly important as parts & systems could represent over 50% of the value of car they were producing.
Throughout their supply chain, parts & systems suppliers were graded into A, B and C groups according to performance on quality, reliability & cost.
General Motors realised that the worst performing group (C) represented 2.6% of overall supplied parts at the beginning of 1996. The client objective was to reduce this to 1%.
ApproachBased in Germany for this project, the project team was asked to step in and help General Motors achieve this target.
The first task was to diagnose 50 of the 550 C-class suppliers as an integral part of the supplier management programme.
As part of a wider improvement project, they then designed & ran a programme of supplier diagnostic visits which included the development of templates for quality improvement focused on process capability, root cause analysis & corrective action planning.
They also carried out review meetings with suppliers to measure progress against plans and resolve further potential problems.
ResultThe results started being realised almost as soon as kicking off this project, with a delivery of significant quality improvements within a period of 2 months. On project completion, the results had been better than expected with C-class parts having been reduced to <0.5% of all parts supplied.
The outcomes saw significant savings for General Motors of around 35,000 Euros per supplier.
As a result of the success rate, the programme scope was extended to cover an even larger group of suppliers of 150+.


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